Statistical Commission Background document Forty-seventh session Available in English only 8 – 11 March 2016 Item 3(g) of the provisional agenda International statistical classifications Classification by Broad Economic Categories, Revision 5 Prepared by Technical Sub-Group on BEC Revision, The expert group on international statistical classifications ST/ESA/STAT/SER.M/53/Rev.5 Department of Economic and Social Affairs Statistics Division Statistical Papers Series M No.53, Rev.5 Classification by Broad Economic Categories Rev.5 Defined in terms of the Harmonized Commodity Description and Coding System (2012) and the Central Product Classification, 2.1 United Nations New York, 2016 ii PREFACE The Classification by Broad Economic Categories (BEC) is an international product classification. Its main purpose is to provide a set of broad product categories for the analysis of trade statistics. Since its adoption in 1971, statistical offices around the world have used the BEC to report trade statistics in a concise and meaningful way, and researchers have used BEC data for analyses. This fifth revision of the BEC (BEC Rev.5) is the outcome of a review process that spanned several years and involved contributions from many classifications experts and data users around the world. This process resulted in a structure that is both more detailed and more logical than the previous version. It responds to the need for more relevant economic categories, includes services in addition to goods, and more clearly distinguishes the end-use of products. New broad categories include “Mining and energy”, “Construction and housing”, “Textile and footwear”, “Information and communication” and “Health and education”. The importance of the BEC for the analysis of global value chains is also highlighted in this manual. In that regard, BEC Rev.5 distinguishes generic and specified intermediate products as a new dimension within the processed intermediate end use category. BEC Rev.5 was considered and endorsed for international use by the Statistical Commission at its forty-seventh session, in March 2016. iii ACKNOWLEDGEMENTS In carrying out the revision of the BEC, the active participation of the Statistical Commission, the Expert Group on International Economic and Social Classifications and its Technical Subgroup were all vital. Further inputs in this process were received from members of the UN Task Forces on International Merchandise Trade Statistics and on Statistics of International Trade in Services, as well as of the OECD Working Party on International Trade in Goods and Services Statistics. The BEC Rev.5 process benefited from the coordination and support of the Chairman of the Expert Group on International Economic and Social Classifications, Andrew Hancock of Statistics New Zealand, as well as the Chair of the Technical Subgroup of the BEC Revision, Norbert Rainer of Statistics Austria. Helpful comments were also provided by the following members of the Subgroup: Ashish Kumar and Dr. Sinha (India), Ana Franco, Axel Behrens, Michael Mietzner and Veijo-Ismo Ritola (Eurostat), Nadim Ahmad, Fabienne Fortanier, Bettina Wistrom, Norihiko Yamano, Sebastien Miroudot and Colin Webb (OECD), Olga Memedovic and Shyam Upadhyaya (UNIDO), Tom Beris (WCO), Joscelyn Magdeleine and Andreas Maurer (WTO), Federico Dorin (UNECLAC), Karoly Kovacs, Markie Muryawan, Luis Gonzalez, Matthias Reister and Ronald Jansen (UNSD) and Tim Sturgeon as consultant for UNSD. Special thanks to Tim Sturgeon, who was active throughout the revision process and especially during the final phases of editing. His work was executed in close cooperation with Ronald Jansen of UNSD, who was directly responsible for the different stages of the revision process, including the organization of meetings and consultation rounds. iv SUPPORT FOR BEC USERS The United Nations Statistics Division (UNSD) is responsible for the development and maintenance of BEC Rev.5 and its correspondence tables. Users of BEC are encouraged to request clarification, share their experience and remarks with regard to the adequacy of the classification, and provide ideas or proposals for enhancing its usefulness. UNSD will use its website to provide further information on the rationale and possible applications of the BEC and make the correspondence tables of BEC with HS, CPC, EBOPS and ISIC available. Those tables will be subject to modification since the BEC classification is based on actual trade practice and such practice may change over time. Again, users are encouraged to report changes in trade practice regarding particular detailed HS commodities. Updated information on BEC and its correspondence tables are available from the web site of the United Nations Statistics Division at http://unstats.un.org/unsd/trade International trade statistics in terms of BEC are available from the UN Comtrade website at http://comtrade.un.org Questions regarding BEC can be sent to [email protected] Official communications regarding BEC should be addressed to the Director, United Nations Statistics Division, by mail: 2 United Nations Plaza Room DC2-1670 New York, NY 10017 United States of America v Table of Contents PREFACE ........................................................................................................................................................... III ACKNOWLEDGEMENTS ................................................................................................................................ IV SUPPORT FOR BEC USERS ............................................................................................................................ V I. INTRODUCTION ................................................................................................................................. 7 A. HISTORICAL BACKGROUND .................................................................................................................................. 7 B. RECENT DEVELOPMENTS...................................................................................................................................... 9 II. MOTIVATION TO REVISE THE BEC ........................................................................................... 10 A. DECISION TAKEN BY THE UNITED NATIONS STATISTICAL COMMISSION .................................................. 10 B. WHO IS USING THE BEC AND FOR WHAT PURPOSES? .................................................................................. 10 C. IMPROVING THE STRUCTURE OF THE BEC ..................................................................................................... 11 D. INCLUSION OF SERVICES IN BEC REV.5.......................................................................................................... 13 E. BEC AND GLOBAL VALUE CHAIN ANALYSIS ................................................................................................... 13 III. THE STRUCTURE OF BEC REV.5 ................................................................................................. 14 A. DIMENSION OF BROAD ECONOMIC CATEGORIES – TOP LEVEL .................................................................. 14 B. PRODUCT DIMENSION – SECOND LEVEL ......................................................................................................... 14 C. THE SNA END-USE DIMENSION – THIRD LEVEL ........................................................................................... 15 D. PROCESSING DIMENSION – FOURTH LEVEL .................................................................................................... 16 E. SPECIFICATION DIMENSION – FIFTH LEVEL ................................................................................................... 17 F. DURABILITY DIMENSION – SIXTH LEVEL ........................................................................................................ 18 G. SPECIFIC COMBINATIONS OF THE 6 DIMENSIONS .......................................................................................... 19 IV. THE COMPILATION OF THE BEC ................................................................................................ 19 A. CODING OF BEC REV.5 ...................................................................................................................................... 19 B. DISTRIBUTION OF THE CPC SERVICES AND HS GOODS CATEGORIES ACROSS BEC MAIN CATEGORIES 20 C. IDENTIFICATION OF THE END-USE CATEGORIES ............................................................................................ 20 V. RELATIONSHIP TO OTHER CLASSIFICATIONS ..................................................................... 21 A. RELATIONSHIP TO THE CENTRAL PRODUCT CLASSIFICATION .................................................................... 21 B. RELATIONSHIP TO THE HARMONIZED SYSTEM ............................................................................................. 22 C. RELATIONSHIP TO THE STANDARD INTERNATIONAL TRADE CLASSIFICATION ....................................... 22 D. RELATIONSHIP TO OTHER STANDARD CLASSIFICATIONS ............................................................................. 22 E. RELATIONSHIP TO EARLIER REVISIONS........................................................................................................... 23 ANNEX 1: STRUCTURE OF THE BEC REV.5 ........................................................................................... 24 ANNEX 2: BEC REV.5 IN TERMS OF HS-2012 AND CPC 2.1 .............................................................. 28 vi I.